Cathie Wood: Tesla's Stock Will Skyrocket Tenfold With Robotaxi Launch
2min read On Tuesday, Cathie Wood, the head of the U.S. investment management firm ARK Invest, said in an interview that as Tesla gradually launches its Robotaxi business, it will drive its stock price to rise about tenfold.
Three years ago, Wood Sister made a fortune by heavily investing in Tesla and became popular on Wall Street overnight. Now, she is once again highly praising Tesla, believing that Tesla will transform from a pure electric car manufacturer by leveraging the Robotaxi business and gaining substantial profits in the autonomous driving taxi business.
The Autonomous Driving Taxi Business Will Be The Largest AI project
Wood estimates that the autonomous driving taxi ecosystem will be a global opportunity with a revenue of $8 to $10 trillion, and Tesla is expected to become the industry leader.
Autonomous taxi platforms are the biggest AI project evolving today, she said, adding that ARK's valuation of Tesla is mainly based on its potential for autonomous driving. If we are right, the stock has miles to go.
Wood said that the business model of the autonomous driving taxi network business is very different from the one-time deal business model of car manufacturing and sales: the autonomous driving taxi will be a winner-takes-most industry, and those who can transport passengers in the safest and fastest way will gain the largest market share.
At the same time, the providers of the autonomous driving taxi network will be able to obtain 30% to 50% of the revenue from the fleet on their platform, thus obtaining a recurring revenue with explosive cash flows and a profit margin of more than 50%.
Wood also boldly predicted that as autonomous driving technology gradually becomes popular in the transportation industry, autonomous driving trucks may weaken the pricing competitiveness of the railway industry. She added that the railway system favored by veteran investor Buffett may be impacted.
Tesla Will Achieve Business Transformation
Before Wood made the above remarks, due to the slowdown in global electric car sales, Tesla's stock price had fallen nearly 43% year-to-date as of April 22. Although Tesla's stock price has rebounded sharply in the past two months, wiping out most of the losses for the year, its performance is still far behind the other six of Mag Seven.
However, in Wood's view, Robotaxi will make Tesla's stock price soar. Because she predicts that in the autonomous driving taxi business, Tesla will lead the U.S. market.
She also revealed that as Tesla's stock price rebounded recently, the innovation ETF she manages has made some profits from Tesla, but she expects the stock price to continue to rise because she believes Tesla is about to share more information about its autonomous driving taxi project.
Although Musk has already admitted on X that Tesla will delay the release time of its Robotaxi, this news has also caused Tesla's stock price to adjust recently, but Wood Sister is not worried.
We're probably getting closer to this robotaxi opportunity, not further away, she said, Musk wants to show us something more awe-inspiring than we might have seen on Aug. 8. And he believes it's possible by October.
Wood has always been optimistic about Tesla, and in her ARK Innovation ETF, Tesla is in the largest position. The fund has lost nearly 9% this year, and due to a large number of investors redeeming, its asset size has shrunk by about one-third. In contrast, the S&P 500 index has risen by about 18% this year.